ThreeFold Tokenomics Discussion

Welcome to the TFT tokenmomics discussion forum. This is our community space to discuss the updates to our tokenomics model. Whether you are a token holder and or farmer, please feel free to post any questions and comments related to this topic thread.

Some of the proposed updates:

  1. TFT Max Cap @ 2 Billion TFTs
  2. Burning on cultivation 40-45% (Standard DIY Hardware)
  3. Formula based difficulty level, greater difficulty in farming of tokens as more tokens are released (instead of Foundation Guardian vote)
  4. Introduction of CRP = Cloud Production Rate (Combination of SU & CU) to enable farmers to have an easier understanding of potential ROI from a give node)

Some additional notes:

  1. Bandwidth metrics has not been factored in top the equation, any suggestions for its inclusion would be welcome.
  2. We would like the Network to reward farmers for distributed capacity versus densely populated single location capacity. That reward mechanism has not been included in the current tokenomics model any suggestions would be great.

Take a look at the tokenomics section on our wiki here.

And we’ll let you know when the simulator is available.

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Thank you!

Ive got a question from potential farmers: will we have some kind of calculator to calculate a farmer’s profit in this new model?

@nickolay as shown in the call, the jupyter calculators will be available soon (should be somewhere this week) for everybody to install. A wiki will accompany this to show people how to install and use it.

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Let’s brainstorm about bandwidth and geo-location (geographical spread of the nodes within the grid).

I think it’s important to include bandwidth as a metric, as a high CRP is useless if it is unreachable. Its is also less valuable if the available capacity is all located in a single country, so geographical spread should also be incentivised. We can’t measure bandwidth on a single moment only, so we need to do this over time.

So, we have bandwidth (over time) and geo-location (over time?).

From a technical point of view, available capacity to connected device and its geo-position should be easy to determine. Its also easy to check if a geo-location is inside a densely populated area (lots of TF nodes) or not.

If you then come to a formula to link this data to the vesting period of tokens (also a factor over time), then I think you could have a starting point. E.g. the more bandwidth is available, the faster you can vest your tokens and vice-verse. Extremely poor bandwidth situations, can then be ‘penalised’ with a very long vesting period.

Similar for geo-location. If you start a node in a place not densely populated, the vesting period could be shortened by a certain factor and vice verse.

So the incentive for high available bandwidth, and spreading nodes is a shorter vesting periods for your tokens which is valuable of course.


How/where would this be ‘installed’?

I very much agree with these thoughts.

If supplying capacity at the Edge is a core value of the ThreeFold project then we have to encourage farmers to ‘fill in the gaps’.

In order to do this there needs to be an incentive, and currently the economic incentive is to add new capacity next to your existing capacity - this is in fact the opposite of what TF is trying to achieve as we will end up creating our own version of the current internet’s centralised data centres!

Further, these clusters will be located in places where it is convenient for the farmer to house them, not where the actual demand is.

As blockchain and zero human intervention are also core values, this needs to be built in to the farming TFT calculation. So distance from existing nodes needs to be factored in - the further the new node is from existing nodes the higher the reward.


Demand Driven Supply

This relates to the geolocation topic of ‘filling in the gaps’ to create a dispersed global grid of nodes, but I think a secondary factor needs to taken into account - DEMAND.

The farming TFT calculation should also factor in where the demand is and incentivise farmers to place new nodes close to it. We should debate what the metrics should be but some kind of capacity utilisation moving average seems logical (3 months initially moving out to a year longer term when the grid is more mature?).

This will organically form clusters where farmers can enjoy economies of scale by concentrating capacity in one place, but cluster location will be driven by demand instead of where it’s cheap or convenient for the farmer to place their nodes.

Placing capacity very close to demand is an absolute core value of our project so needs to be built into the TFT tokenomics.

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Yes, but you can also state that supply will create demand in this case.

I leave implementation to the nerds…

I would say don’t make it to complex …

will try to come up with something so we can also simulate,
but please note we don’t have much time left, end of this month we want to launch and let the world know we exist. Its important to make the tokens more public, because without liquidity there is no economical model for the farmers and if there is no economical model then the grid will not grow which is needed to create a new internet we all want.
Network gives a farmer more upside which means the current simulator is too conservative.


Sure. No no need to be 100% perfect at launch not? We can improve based on actual data. Learning by doing is my motto!

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Another perspective here is that the fundamental beliefs of ThreeFold are sovereignty, equality and sustainability. The farmer community is made up of entrepreneurs that decide independently what their preferred model of creating digital utility is. Some of them will take it forward in large quantities in traditional datacenters, others will go to every nook and cranny and this globe and deploy mini sites.

We need all of that to happen to meet the exponential growth of digital utility consumption and therefore respecting the founding principles of the foundation everyone should have equal opportunity and rewards for contributing. :pray:


I completely agree with Weynand. Introducing further complexity into this already fairly complex Farming model is counter productive. Same rules for all , simply stated and simple to understand and therefore to model is the way to go. Independent entrepreneurial farmers will evaluate what’s most attractive for them according to a whole variety of different criteria. It isn’t TF’s job to come up with differing token incentive models for every possible permutation. It’s an unnecessary distraction IMO.

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We all know free-markets have failed, and that more controlled ones are surviving currently :wink:

As for bandwidth, you could determine the speed of the connection just the same as providers do. Just send a payload and retrieve it again, measure the time it takes. Fairly simple if you ask me.
As for geolocation, that is less important to me NOW, but it IS important to keep it in mind, but I would love to see our system work and being used before taking that on…

I think we will be facing other issues when starting to welcome users on our grid, you will be surprised as to the creativity of scammers when it comes to exploiting the system, be it as a farmer or as a user.
And users is what we need, because the only way a farmer will be completely f***d is when no one uses the grid. In that case no tokens get burned and when reaching the 2 Billion cap no more rewards at all…

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An elegant solution for better distribution of capacity could be to have bounties for capacity in locations that are not yet covered.
As I understand countries have their unique ranges of IP adresses. If someone provides capacity to a country that is not yet covered, he earns +X% of tokens (maybe +100%).

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I understand why Tokens will be burned, but what is the reason 40 or 45% of the Tokens will be burned in the new cultivation payment method? Why not less, eg 10%?
In this new model it seems to me the Token is losing some value, actually almost half…
Farmers get paid in Tokens for offering capacity.
In the previous model farmers asked eg 100 tft and received 90 tft. The Foundation took 10 tft.
Now in the new model farmers will receive 50 tft. So they will have to either earn less, either ask more Tokens for the capacity they offer. By asking 180tft they will get the same 90tft as they did in the previous model.
But, if they ask more tokens, then the token value should go lower…
You might say the Token will go higher, but then the price the endconsumer is paying will be about times 1.8 in comparison with the previous model.
Could somebody clarify please?

Hello Patrick,

Lots of good and valid questions which help us to evolve the model. Let me invite you to a Farmer Model Tokenomics Zoom to tackle all open questions and show you the latest simulations based on your feedback. The call will be on Monday the 6th of April at 18.00 CEST. Here is the Zoom link

Looking forward to see you there!

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